The Savings Banks Foundation (Funcas) foresees that the island regions of Balearic and Canary Islands, the Community of Madrid and Catalonia be the autonomies with biggest drop in GDP in 2020, thus becoming the most affected by the economic crisis derived from the coronavirus pandemic.
Specifically, it is estimated that Baleares is the community most punished, where a 22% drop in GDP in 2020. The impact will also be severe in the other island region, Canarias (-17.9%), Madrid (-13.6%) and Catalonia (-13.5%).
These four Communities are the ones that will register cuts in GDP higher than the national average, which stands at -12%, being one of the most pronounced among the developed countries. In the rest of the autonomous regions, the decrease in GDP will be lower than the average, Murcia becoming the least affected community, with a drop of 7.3%, together with Castilla-La Mancha and Extremadura, with rates of -7.5% and -7.9% respectively.
This has been communicated by the CEO of Funcas, Carlos Ocaà ± a, in a telematic press conference in which he presented the forecasts for the Autonomous Communities 2020/2021 together withhe director of Situation and International Economy at Funcas, Raymond Torres.
According to his report, they can be categorize the Autonomous Communities into three groups in relation to the fall in GDP. This is respectcto the first group, the hardest hit by the crisis, is made up of the island regions that will be most affected by the fall in tourism.
At second group are the Autonomous Communities that will suffer the crisis more moderately, but with a fall that continues to be higher than the average for GDP at the national level, and here are Catalonia, the Community of Madrid and Asturias.
The third group, the one that is in line with the national average, is that of the Less affected communities that live more from primary sector activities and that they depend less on economic activity dependent on tourism. Extremadura, Castilla-La Mancha, Murcia and the Autonomous Community of Navarra are located here.
2019-2021 BIENNIUM GDP
In relation to the fall in GDP between 2019 and 2021, Castilla-La Mancha, Navarra, Murcia and Extremadura have GDP falls of less than 4% between those two years, while other regions – Basque Country, Aragon, La Rioja, Cantabria, Valencian Community, Castilla y León, Andalusia and Galicia – also fare better than the average, with setbacks in the biennium than they range between 4.2% and 5.8%.
That yes, as they point out in Funcas, the regions where the weight of services is greatest most affected, that is, the most punished in 2020, they will be the ones that will grow the most in 2021. On the other hand, these sectors will suffer a marked permanent impact, so that the autonomous communities where they have the greatest presence, despite the higher growth expected in 2021, will also be the ones that take the longest to recover the GDP level prior to the pandemic.
In relation to the 2021 forecasts, Funcas calls for an interpretation from the caution given that they are subject to a high degree of uncertainty due to the evolution of the pandemic and the management capacity of European funds.
With these assumptions, the recovery expected for 2021 will reduce the disparities generated by the economic crisis, which will allow the most dynamic Autonomous Communities such as Catalonia and Madrid – among the most affected in 2020 – to recover part of the lost ground.
THE FALL OF EMPLOYMENT
Within the report prepared by Funcas, an analysis is also made studying the impact on the labor market of the economic crisis stemming from the coronavirus pandemic. In this regard, they suggest that the drop in employment has been limited thanks to ERTE or to extraordinary benefits for the self-employed.
However, both the decline in membership and the use of such schemes reflect the same differential regional pattern. Thus, the Balearic Islands and the Canary Islands are the Autonomous Communities with the greatest impact on employment, both due to the drop in the number of affiliates and in terms of effective employment.
Murcia, Extremadura and Castilla-La Mancha are the regions where the volume of jobs affected has been lower, according to both criteria mentioned above.
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